Another Gold Deposit in GLD — and More Silver Deposited at JPMorgan

18 October 2016 — Tuesday


There was no gold price activity worthy of the name during the Monday trading session — and volumes were pretty light.  Of course it could also be said that no price activity worthy of the name was allowed yesterday — and it’s your choice as to which it was.

There was some shape to yesterday’s price action, as gold rallied in Far East trading on their Monday, only to be sold off starting shortly before the London open, which is a pattern we’ve seen continuously.  The low of the day came around 9:15 a.m. in London — and it managed to ‘rally’ until 9 a.m. in New York, but didn’t do much after that.

Once again, the high and low ticks aren’t worth looking up.

Gold finished the Monday session in New York at $1,255.30 spot, up $4.80 from Friday’s close.  Net volume checked in at just under 91,500 contracts.161018gold

Up until its low tick of the day at 9:15 a.m. BST in London yesterday morning, silver followed a very similar price path go gold.  Silver began to edge higher from there — and got a bit of kick once the noon silver fix was done, but it certainly wasn’t allowed to trade higher than that for the rest of the day.

The high and low ticks aren’t worth looking up for this precious metal, either.

Silver was closed in New York yesterday afternoon at $17.44 spot, up 6 cents on the day.  Net volume was pretty light as well at just under 29,500 contracts.161018silver

The platinum price was up 8 bucks by the London/Zurich open — and except for the odd price pop, it was manhandled down to its $922 spot low tick about twenty minutes after the London p.m. gold fix was put to bed.  It chopped higher from there right into the 1:30 p.m. EDT COMEX close — and continued higher right into the 5:00 p.m. close during the thinly-traded after-hours session as well.  Platinum finished the day at $936 spot, up 3 bucks from Friday.  But as I pointed out a few lines above, it was down $11 at one point.161018platinum

After getting sold down 6 bucks right at the open on Sunday evening in New York, the palladium price rallied until noon China Standard Time.  The high at that juncture was $653 spot.  Then, like platinum, it was sold off to its low tick of the day about 10:10 a.m. EDT.  It didn’t do much after that, but did manage to rally weakly in the after hours.  Palladium was closed down 7 dollars on the day at $638 spot.161018palladium

The dollar index closed very late on Friday afternoon in New York at 98.08 — and made it as high as 98.15 by around 6 p.m. in New York on Sunday evening.  It began to chop quietly and rather unsteadily lower at that point, with it’s 97.82 low tick coming shortly after the 1:30 p.m. COMEX close.  It rallied a handful of basis points from there — and finished the day at 97.88 — down 20 basis points from its close on Friday.  Here’s the 3-day dollar index chart so you can see the Friday, Sunday and Monday action in some perspective.161018intraday-gif

And here is the 6-month U.S. dollar index chart — and it’s starting to look a bit toppy to me.161018-6-month-usd

The gold stocks rallied just under 2 percent right out of the chute, but by 11 a.m….the London close, they were almost back to unchanged.  Then by 1 p.m. EDT they were up 2 percent — and held in there until shortly after 3 p.m. — and then sold off a bit into the close.  The HUI finished the day higher by 1.69 percent.161018hui

The silver equities followed virtually an identical price path — and Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed higher by 1.64 percent.  Click to enlarge if necessary.161018silver-7

The CME Daily Delivery Report showed that 5 gold and zero silver contracts were posted for delivery on Wednesday.  ADM issued all five into JPMorgan’s client account.

The CME Preliminary Report for the Monday trading session showed that October gold open interest fell by 534 contracts, leaving 127 still open, minus the 5 contracts posted above.  Friday’s Daily Delivery Report showed that 530 gold contracts were actually posted for delivery today, so that means that 534-530=4 short/issuers were let off the delivery hook by the parties holding the long side of those contracts.  Silver o.i. for October actually increased by 3 contracts.  Friday’s Daily Delivery Report showed that 1 silver contract was posted for delivery today, so that means that 1+3=4 more silver contracts were added to the October delivery month.

Another day — and another deposit in GLD.  This time an authorized participant added 57,223 troy ounces.  And as of 8:18 p.m. EDT yesterday evening, there were no reported changes in SLV.

The folks over at Switzerland’s Zürcher Kantonalbank updated their website with the goings-on in their gold and silver ETFs for the business week ending on Friday, October 14 — and this is what they had to report.  Their gold ETF added 26,363 troy ounces — and their silver ETF increased by 47,583 troy ounces.

There was a big sales report from the U.S. Mint yesterday.  They sold 10,500 troy ounces of gold eagles — 2,000 one-ounce 24K gold buffaloes — and a chunky 675,000 silver eagles.

With half of October’s business days under our belt as of the close of trading yesterday, it can be safely assumed that Ted’s comments about JPMorgan being back at the U.S. Mint’s trough is a fact.  Because so far this month the mint has sold 76,000 troy ounces of gold eagles — 14,000 one-ounce 24K gold buffaloes — and 2,775,000 silver eagles.  These sales number are literally miles ahead of where they were this time in September.

There wasn’t much activity in gold over at the COMEX-approved depositories on Friday.  There were 25 kilobars [U.K./U.S. 32.150 troy ounce weight] received at Manfra, Tordella & Brookes, Inc. — and that was all.  I shan’t bother linking this amount.

It was another hugely busy day in silver, as 1,004,022 troy ounces were received — and 856,649 were shipped out the door for parts unknown.  Of the ounces received, there was 599,367 deposited at CNT, plus another 396,021 into JPMorgan — and 8,633 troy ounces into HSBC USA.  Of the amount shipped out, there was 606,504 troy ounces shipped out of Delaware, plus 250,144 out of Canada’s Scotiabank.  The link to that action is here.

Over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday, they reported receiving 819 kilobars — and shipped out 3,607 of them.  All of this activity was at Brink’s, Inc. — and the link to that, in troy ounces, is here.

Here’s a chart that Nick Laird passed around shortly after midnight on Saturday morning Denver time — and since I was ‘full up’ with charts for my Saturday column, it had to wait until today’s missive.  It shows the Weekly Transparent Gold Holdings in all known depositories, mutual funds and ETFs for the last couple of years.  What should be noticed at a glance is that despite the fact that the gold price is down US$100/ounce since early July, the amount of physical gold in GLD continues to rise.  The amount, in millions of troy ounces, is slaved to the Y-axis on the left side of the chart — and the gold price is shown on the right side.  Click to enlarge.161018weekly-gold-holdings

Here are two more charts that Nick passed around…these ones on Saturday night.  They show gold and silver imports into India, in tonnes, going back almost 20 years.  As you can tell, barring a miracle, gold and silver imports in 2016 will be far below what they imported in 2015.  Click to enlarge for both charts.161018india-gold


I have quite a few stories for you today — and I’ll happily leave the final edit up to you.


The Day Has Arrived: As of Today Prime Money Markets Can Suspend Withdrawals – Here Are the Implications

The big day has finally arrived: starting today, as previewed repeatedly over the summer, the SEC’s 2a-7 money fund reform adopted in 2014 officially requires many prime money market mutual funds (those that invest in non-government issued assets such as short-term corporate and municipal debt) to float their net asset value. More importantly, these prime MMFs are allowed to delay client withdrawals under adverse market conditions.

The rule aim to prevent the sort of chaos that hit the money market after Lehman Brothers Holdings Inc.’s 2008 bankruptcy, which helped spark the financial crisis. The goal is to give investors a way to monitor a fund’s health by tracking its fluctuating net asset value, and to contain the fallout that could be caused by many investors cashing out at once, the SEC wrote in the final rules.

As as result, many Prime MMFs are and have been converting their assets to government funds, not buying CDs anymore and moving into Treasurys and agencies. As the chart below shows, nearly $1 trillion in assets have rotated out of prime money markets into government funds, as a result sending Libor rates through the roof, to the highest level since the financial crisis, with consequences that have yet to be determined.

This longish chart-filled commentary put in an appearance on the Zero Hedge website last Friday afternoon — and I thank Brad Robertson for pointing it out.  Another link to this story is here.

Dallas Police Retiring in Droves, Taking Lump Sum Pensions, Fearing the Money Isn’t There (And It Isn’t)

The Dallas police and firefighters pension fund has just 45{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of the money it needs to cover benefits. The fund rates to be out of money in 15 years at the current rate of withdrawals.

For those eligible, the sane thing to do is retire and take a lump sum payout before the money is all gone.

That’s precisely what’s happening, and it is further pressuring the system.

The squeeze on Dallas’s fund is even more acute because of a decision to divert money from stocks and bonds into Hawaiian villas, Uruguayan timber and undeveloped land in Arizona, among other non-traditional investments. The strategy, put in place under prior managers, backfired. The fund lost 12.6 percent in 2015 and 0.7 percent over the past three years.

This is the Mish Shedlock spin on a Bloomberg story from way back on September 27 that finally made into his column this past Sunday.  I posted this story when it first came out, but in case you missed it, I though it worth reposting.  It’s the first contribution of the day from Roy Stephens — and another link to it is here.

Former U.S. Attorney: Agents See FBI Chief Comey as a ‘Dirty Cop’

James Comey presides over an FBI in revolt over his leadership, a former U.S. attorney tells The American Spectator, and pursues “paranoid, delusional, and vindictive” measures to prevent negative information leaking out to the public.

I know that inside the FBI there is a revolt,” Joseph diGenova tells The American Spectator. “There is a revolt against the director. The people inside the bureau believe the director is a dirty cop. They believe that he threw the [Hillary Clinton e-mail] case. They do not know what he was promised in return. But the people inside the bureau who were involved in the case and who knew about the case are talking to former FBI people expressing their disgust at the conduct of the director.

The loss of faith in the bureau chief stems in part from a dishonest rendering of the decision not to indict Mrs. Clinton as unanimous rather than unilateral and in part from the bureau’s decision to destroy evidence in the case and grant blanket immunity to Clinton underlings for no possible prosecutorial purpose.

There is a consensus among the employees that the director has lost all credibility and that he cannot lead the bureau,” diGenova explains. “They are comparing him to L. Patrick Gray, the disgraced former FBI director who threw Watergate papers into the Potomac River. The resistance to the director has made the agency incapable of action. It has been described to me as a depression within the agency unlike anything that anyone has ever seen within the bureau. The director’s public explanation for the unorthodox investigation are viewed by people in the bureau as sophomoric and embarrassing.”

Why should anyone be surprised?  This short essay was posted on the Internet site last Thursday afternoon EDT — and I found it in yesterday’s edition of the King Report.  It’s a must read if you have the interest — and another link to it is here.

Amazing words by Donald Trump

I know, I know.  These are just words.  But listen to these words, these are absolutely amazing words, nobody before dared say what Trump says.  At the very least, I think that we have to give him the benefit of the doubt.  What if Trump is really sincere?  I am not saying that he is.  But I am wondering – what if?!

Well, dear reader, being Canadian, I obviously don’t vote in U.S. elections.  But if I did, Trump has my vote by default.  I’m not mad for the guy because he has said some really nutty things — and I’m always wondering how much control his handlers have over him, with the conclusion being…not much.

However, here’s 4:52 minute video clip where what he says sounds suspiciously like something that JFK or Martin Luther King would have said way back when.  It was posted on the Internet site on Saturday — and I thank fellow Canadian Norbert Klingbeil for pointing it out.  Another link to this short video is here.

By Way of Deception Thou Shalt Lose Your Empire — The Saker

In April of 2014 I wrote an article entitled “How the Ukrainian crisis will eventually bring down the Anglo/Zionist Empire” in which I made a list of the similarities between the Soviet Union of the 1980s and Obama’s USA and wrote the following:

What the Anglo/Zionist are openly and publicly defending in the Ukraine is the polar opposite of what they are supposed to stand for. That is an extremely dangerous thing to do for any regime and the Anglo/Zionist Empire is no exception to that rule. Empire often crumble when their own people become disillusioned and disgusted with massive discrepancy between what the ruling elites say and what they do. And as a result, it is not so much that the Empire is faced with formidable enemies as it is the fact that nobody is willing to stand up – never mind die – in defense of it.

Over two years later, watching the Presidential race between Trump and Hillary I am amazed to see how deep and “in your face” the habit of lying, denying the obvious, deceiving and otherwise misrepresenting has permeated the U.S. political discourse.

First and foremost, there is the absolutely unabashed way the corporate Ziomedia is bashing Trump without even so much as a pretense of objectivity or truthfulness. Of course, I always knew that the U.S. propaganda machine was lying and that the media was owned by the U.S. deep state, but at least there was this thin veneer or pseudo-objectivity, of having “both sides” heard. Now this is over. When dealing with Trump, we have Orwell’s “Two Minutes of Hate” but spread over 24/7. Not that Trump does not deserve some of it, he sure does, but compared to how real scumbags like the Clintons are treated, the lynching of Trump is, I believe, unprecedented and unique. Why does it matter? Because now the masks have been taken off, the pretenses removed, and what you see is the true face of the corporate media as it always was: hateful, hypocritical and totally corrupted. And since a truly free and independent media is central to a functioning democracy, then the total corruption of the media in the U.S. is also the proof that this country does not have a functioning democracy.

This pretty much right-on-the-money commentary by The Saker was posted on his Internet site last Thursday — and is certainly worth reading if you have the time.  Larry Galearis sent this our way on Saturday — and obviously too late for Saturday’s column.  Another link to it is here.

U.S. Badly Needs Russia’s Technology to Keep Its Space Program Afloat

Russian Energomash Corporation has found a new customer in the United States. According to a new contract, Energomash will deliver 14 RD-181 engines to the U.S. Orbital ATK aerospace and defense industry company over the next two years. Igor Arbuzov, the head of the Russian company, made the announcement on October 13.
The engines will be used by Antares expendable launch systems to launch the Cygnus spacecraft developed by Orbital ATK to the International Space Station as part of NASA’s programs. The RD-181 engine is a modification of the RD-180, developed specifically for the US Antares rockets. The single-chamber booster is similar to the dual-nozzle RD-180 engine flown on the Atlas 5, producing about the thrust of its larger cousin.

There is opposition in Congress to the use of Russian engines. For instance, Republican Senator John McCain strongly opposes the idea. In 2014, U.S. lawmakers banned the use of Russian engines after Crimea became part of Russia. In 2015, the Congress had to ease the ban to keep the US space program going.

ULA and the Pentagon have maintained that Russian engines are cheaper than the US alternatives. The RD-180 is used for the Atlas rocket, the workhorse of the U.S. space fleet. A total of 70 Atlas V rockets with Russian RD-180 boosters had been launched successfully so far. If the Pentagon abandons the RD-180 engines, the cost of launching key satellites will skyrocket.

U.S. Senator McCain is right to say, “This is the height of hypocrisy! How can our government tell European countries and governments that they need to hold the line on maintaining sanctions on Russia, which is far harder for them to do, when we are gutting our own policy in this way?

The rocket engines’ deal testifies to the fact that Russia and the U.S. continue to cooperate in the field of space research, where America badly needs Russian cutting edge technology. It is also an example of egregious hypocrisy and double standards when Washington makes the allies do the dirty work for it. This is a very serious matter for the Europeans to think about. It also puts into question the very expediency of the sanctions. Is it worth it, if nobody but the U.S. – the initiator of the sanctions – pays Moscow billions of dollars for rocket engines to boost Russian economy?

Well, dear reader, this is just about the only time that I’ve ever agreed with Mr. McCain on anything.  This very interesting news item appeared on the Internet site yesterday — and it’s the second of three in a row from Larry Galearis.  Another link to this article is here.

Maybe Trump Could Run the E.U.? — Eric Margolis

Most Europeans are quietly horrified watching Donald Trump torn to pieces by political piranhas while Wall Street’s candidate, Hillary Clinton, appears to be pushing for a war with Russia. She blames everything on that wicked Vlad Putin. How long before she will claim Monica Lewinsky was one of Putin’s famed KGB seductress agents (I’ve met a few) known as ‘swallows?’

Europeans, whose male political leaders all seem to have mistresses, would laugh off Trump’s awkward gropes and the outrage they caused as adolescent. Better gropes than a possible war with Russia over Syria. But Trump looks like a mastodon stuck in a primeval tar pit, ambushed by Democratic hunters.

Does anyone remember the Democrat’s young god, Jack Kennedy, who used to drag women into the White House linen closet, smoke a joint, and give them a presidential quickie? Lyndon Johnson’s Texas rough-riding, or Nelson Rockefeller’s too young girlfriends that did him in?

Bad as things are in the U.S., they are not much better in Europe. The foolish flight of racist Britain from the European Union has deflated its outrageously inflated pound sterling and spread panic among fat cat bankers and property developers. The last rags of Britain’s imperial pretensions have been ripped away.

This excellent commentary is definitely worth reading.  It showed up on the Internet site on Saturday — and it’s the third and final contribution of the day from Larry Galearis — and I thank him on your behalf.  Another link to this very worthwhile read is here.

A Failed Bond Swap Deal, Low Oil Prices Could Signal the End for PDVSA…and Venezuela

Venezuela’s PDVSA is in the hot seat today, with only one business day left for investors to take or leave its $5.3 billion 2017 bond proposal to push new notes back into 2020.

The likelihood of investors accepting this deal depends on how flexible the floundering Venezuelan oil company is at the hypothetical negotiating table in the final hours, according to two analysts.

“If the swap doesn’t happen, they’re in big trouble for next year,” said Francisco Monaldi, Latin American energy policy fellow at the Baker Institute for Public Policy. “I think they’re really worried about that.”

Monaldi added that PDVSA was hoping that the swap—along with oil prices—would rescue it from the precarious position it is now in, but neither remedy is looking too hopeful at this point.

Raul Gallegos, Control Risks senior analyst, said of the swap deal that the initial terms were not enough to lure investors, and that the adjusted terms were not “doing much for investors” either, adding that if oil prices ticked up a bit, it might be enough to get them through next year.

Despite the hard road ahead, the analysts believe that it is possible for PDVSA to “still scrape through” next year without default, although yields on the Oct 28th 2016 notes are exploding as the market is increasingly worried about disappointment…

This news story was posted on the Internet site on October 15 — and it comes to us courtesy of Richard Saler…via Zero Hedge.  Another link to this article is here.

WikiLeaks says Assange’s Internet link severed by ‘state party’

WikiLeaks announced Monday co-founder Julian Assange‘s Internet link was severed by what it described as a “state party.”

“Julian Assange’s internet link has been intentionally severed by a state party. We have activated the appropriate contingency plans,” WikiLeaks said, hours after it published three tweets, each reading “pre-commitment” and then referencing Ecuador, U.S. Secretary of State John Kerry and the United Kingdom Foreign Commonwealth Office, each followed by a 64-character numerical code.

Some social media users inferred the three tweets were examples of use of a “dead man’s switch,” triggered in the event of Assange’s death. If Assange had died, any automatic release of information by WikiLeaks would likely contain considerably more data.

The WikiLeaks announcement did not identify a suspected “state party” or explain how Assange’s link was severed. After receiving asylum at the Ecuador Embassy in London in 2012 to prevent extradition to Sweden over a rape allegation, the Internet is Assange’s only means of communication with the world. Assange denies the rape allegation and said he suspects it would lead to his extradition to the United States.

Several weeks ago he said WikiLeaks would release weekly confidential information pertinent to the U.S. presidential election. More than 12,000 e-mails, believed to be from John Podesta, Democratic candidate Hillary Clinton‘s campaign manager, were released in October. Clinton’s campaign has suggested WikiLeaks is working with the Russian government to subvert her efforts in favor of Republican candidate Donald Trump.

The above five paragraphs are all there is to this UPI story filed from London early on Monday morning — and I thank Roy Stephens for finding it for us.  The Zero Hedge spin on this is headlined “Wikileaks activates “Contingency Plans” After Unknown “State Party” Cuts Julian Assange’s Internet Connection” — and that comes to us courtesy of Brad Robertson.

U.K. blocks bank accounts of Russia Today broadcaster

The editor-in-chief of RT, Russia’s state-run broadcaster, claims all of its U.K. bank accounts have been blocked.

Margarita Simonyan tweeted the news, saying: “They’ve closed our accounts in Britain. All our accounts. ‘The decision is not subject to review.’ Praise be to freedom of speech!

According to a letter featured on the RT site, which purports to be from NatWest, the bank will withdraw the card facility on November 14, which is said to be “one month from the date of this letter.All accounts will be closed on December 12,” the letter continues.

The National Westminster Bank, part of the Royal Bank of Scotland Group, reportedly provided no explanation for its decision — and RBS has so far declined to comment on the situation.

Yep, so much for freedom of speech.  I was watching “V for Vendetta” on Netflix last night — and this story fits right in, just about like every other story that has preceded this one in today’s column.  Including the precious metal market, the “deep state” is everywhere these days.  This story showed up on the Internet site on Monday sometime — and I thank U.K. reader “Teresa” for finding it for us.  Another link to it is here.

Euro ‘house of cards’ to collapse, warns ECB prophet — Ambrose Evans-Pritchard

The European Central Bank is becoming dangerously over-extended and the whole euro project is unworkable in its current form, the founding architect of the monetary union has warned.

One day, the house of cards will collapse,” said Professor Otmar Issing, the ECB’s first chief economist and a towering figure in the construction of the single currency.

Prof Issing said the euro has been betrayed by politics, lamenting that the experiment went wrong from the beginning and has since degenerated into a fiscal free-for-all that once again masks the festering pathologies.

Realistically, it will be a case of muddling through, struggling from one crisis to the next. It is difficult to forecast how long this will continue for, but it cannot go on endlessly,” he told the journal Central Banking in a remarkable deconstruction of the project.

This AE-P commentary was posted on the Internet site at 4:51 p.m. BST on Sunday afternoon — and is a must read in my opinion.  I thank reader ‘h c’ for sharing it with us — and another link to it is here.

In Russia’s religious rebirth, Putin is a new Pope — Lawrence Solomon

What explains Putin’s success? Two years ago, amid plummeting oil prices, a plummeting ruble, a contracting economy, the flight of investors and sanctions over Crimea, pundits were predicting Russia’s, and Putin’s, demise. Yet Putin’s popularity at home has soared — hovering well above 80 per cent according to the Associated Press’s and other reputable polls — despite the hardships caused by rising food prices and falling employment.

Western naysayers who dismiss his popularity as rooted in false values — his control over the press, his bare-chested publicity stunts or chauvinism stirred by his military muscle — misunderstand the great respect and moral authority he commands within Russia and neighbouring countries. Putin stands for everything craved by a country debased and diminished by 75 years of communism: A principled leader who protects his country from Western aggression, Western contempt and Western values. While we in the West see ourselves as paragons of enlightenment, the envy of the people who don’t enjoy Western-style liberal democracy, only one in 20 Russians wants to become more like us. The overwhelming majority hews to Putin’s vision of Russian exceptionalism and puritanism.

Unlike almost every other country in the world, Russians have rising birth rates and growing families; unlike almost every other country in the West, Russians are undergoing a religious Renaissance. Putin, who is baptized, is arguably a greater defender of traditional Christian values than the Pope, who has been tolerant of divorce, abortion, gay marriage and the transformation of what was once an unabashedly Holy Christian Europe into a part-atheistic, part-Muslim continent.

It’s nice to see some truths about Russia and Putin in the main stream media.  This opinion piece put in an appearance on the Internet site last Thursday — and it’s definitely worth reading if you have the interest.  I thank Norbert Klingbeil for his second offering in today’s column — and another link to this worthwhile commentary is here.

Saudi Bank Stress Builds as Kingdom’s Cash Injection Falls Short

Saudi Arabia has work to do to ease pressure in the kingdom’s banking system.

The interest rate banks charge one another for loans rose by the most since August on Sunday, extending a trend that’s slowing earnings and corporate borrowing in the world’s biggest oil exporter. The increase is defying the central bank, which has sought to ease the cash crunch by relaxing lending limits, offering new borrowing facilities and injecting funds into the financial system, including 20 billion riyals ($5.3 billion) pledged Sept. 25.

Rates won’t easily come down with one $5 billion injection,” said John Sfakianakis, director of economic research at the Gulf Research Center Foundation in Riyadh. “Bringing them down would require a significant liquidity injection effort. The $5 billion is a good step forward, but given the asset size of Saudi banks it would require several additional injections.”

Financial institutions in the Arab world’s largest economy are bearing the brunt of a halving of oil prices since 2014. Economic growth in the kingdom is slowing, curtailing bank deposits just as the government increases borrowing to help plug a budget deficit that last year was the widest since 1991.

The three-month Saudi Interbank Offered Rate, or Saibor, used as a benchmark to price loans, has climbed 15 successive months to the highest in seven years, according to data compiled by Bloomberg. It gained 84 basis points this year to 2.386 percent on Monday, compared with a 27 basis-point advance in the London Interbank Offered Rate for dollars. Meanwhile, the loans-to-deposit ratio among Saudi banks, a key measure of liquidity, rose to 90.8 percent in August, the worst since 2008.

This news story appeared on the Bloomberg website at 5:12 a.m. Denver time on Sunday morning — and it was sent our way by Swedish reader Patrik Ekdahl.  Another link to this article is here.

Frenzy as Chinese buyers snap up 230 Sydney apartments in hours – despite warnings property is ‘the worst investment’

Almost all of Sydney’s Park One premier apartments have been snapped up by mainly Chinese buyers in a sign Australia’s property boom is far from over.

Chinese Australians bought 80 per cent of the 230 first-stage Macquarie Park apartments, in Sydney’s north-west, while overseas buyers from China, Singapore, Malaysia and Canada picked up the other 20 per cent.
Buyers were seen crowded in the display suite on Saturday and according to the founder of developer Golden Age Group Jeff Xu, people were ‘snatching, not buying‘.

But on Sunday, economist Chris Richardson warned buying property was one of the ‘worst investments‘ and there will be a ‘shakeout‘.

This photo-filled real estate-related news item showed up on the Internet site at 1:27 p.m. BST on Monday afternoon, which was 8:27 a.m. in New York — EDT plus 5 hours.  My thanks go out to Philip Muller for sending it our way — and another link to this interesting story is here.

The Oil Market is Bigger Than All Metal Markets Combined

Ever since the invention of the internal combustion engine, oil has been one of the most crucial commodities on Earth. Without it, modern transportation as we know it would not be possible. Industries such as aviation, aerospace, automobiles, shipping, and the military would look nothing like they do today.

Of course, as we now know, this has all come with some extreme drawbacks from an environmental perspective. And while new green technology and the lithium revolution will aid in eventually reducing the role of oil in transportation, the fact is we still use 94 million barrels per day of crude worldwide.

As a result, the energy industry continues to have huge amounts of influence on our lives. Special interest groups with a focus on energy have influence on a domestic level. Meanwhile, from a foreign policy angle, countries like Saudi Arabia and Russia wield additional geopolitical and economic power because of their natural resources. It’s even arguable that everything from the Gulf War to the more recent Middle East interventions in Libya, Syria, and Iraq have been at least partially to do with oil.

This week’s chart of the week aims to help explain the influence that oil has on countries and markets by using a very simple perspective: the size of the oil market vs. all metal markets combined.

This item was posted on the Internet site last Friday — and is definitely worth reading even if you only look at the most excellent chart.  I thank West Virginia reader Elliot Simon for bringing it to my attention — and now to yours.  Another link to this very interesting news item is here.

Sharps Pixley’s Ross Norman: Central bank manipulation of gold wouldn’t surprise me

GATA Secretary Chris Powell has invited me to reply to his October 15 commentary — in which he replied to my article of the 14th, wherein I rebutted an academic study that concluded that the London gold price fix was manipulated.

If you look at my article (and indeed previous ones) you will see that my aim is to defend the integrity of the London gold fix as a method to derive a fair benchmark price. My aim is not to defend the integrity of the institutions operating the fix.

The reason for this is that I simply do not have the visibility over all fixing members and their every trade that I would need to say that these guys are 100-percent honest. No one does.

That said, I do know that the market traders at the banks are heavily outnumbered by in-house compliance people and it would be close to impossible for them to do anything improper even if they wanted to. The level of forensic investigation into any position taking is actually quite staggering. In the absence of any evidence to the contrary I simply don’t have a view either way.

I might add that I have the same ambivalence toward GATA.

Powell described my assessment as “weak” but it’s a shame that he didn’t go on to say why. I would be interested to hear his views about the fixing process. I would love to hear how he would derive a benchmark.

Well, dear reader, this pissing match occurred over the weekend — and the Ross Norman commentary that set it off was in my Saturday column — and it’s also linked in the above GATA release as well.  My comment on all of this is…why do need a fixing price for gold and silver?  We don’t have one for any other commodity, so why these two?  So that’s my rebuttal to Ross when he states…”I would love to hear how he would derive a benchmark.”  And if the fix isn’t the issue, then please explain to Ted Butler and myself why 8 traders [all of them banks and/or brokerage houses…most of them U.S.-based] are short, at a minimum, 50.0 percent of the entire COMEX futures market in silver — and 41.6 percent in gold!  And that’s against thousands of other traders.  And none of these Big 8 traders either produce nor consume either metal.  They are only there as short buyers and long sellers of last resort to prevent these precious metals from exploding in price to the outer edges of the known universe — and that’s a fact!  Needless to say that this Norman/Powell exchange, plus the two embedded links — are more than worth your while, but should read through the lens of what I just said in this paragraph.  Another link to this article is here.

Reply to Ross Norman: Is GATA discouraging gold investment?

Under the circumstances Ross Norman, CEO of London bullion dealer Sharps Pixley, was pretty heroic with his cordial reply today to the questions your secretary/treasurer publicly posed to him Saturday.

That is, virtually alone in the bullion dealing and banking industry, Norman acknowledged the possibility that central banks are surreptitiously intervening in the gold market and manipulating the monetary metal’s price. “I don’t know for sure,” Norman wrote, “but I would not be surprised.” He added that central banks certainly have motives for rigging the gold market.

While Norman declined your secretary/treasurer’s invitation to review and challenge or accept the documents of that intervention summarized by GATA here…no one has ever challenged them, presumably because they are genuine and support the conclusions GATA has drawn from them and because if Norman had lent any credibility to them he would be quickly ostracized from his industry.

Having been pressing this issue for 17 years against what seems to be all the money and power in the world, GATA knows very well that this issue is essentially prohibited in polite company. After all, the world financial system now rests on the lies that markets are free and currency values true. If those lies are ever exposed and understood, all power arrangements on the planet will change.

So let us be grateful for Norman’s friendly hint that he knows better.

This commentary by Chris appeared on the Internet site yesterday afternoon EDT and, like the above GATA release, is definitely worth reading as well — and another link to it is here.

Deutsche Bank Pays $38 Million To Settle Silver Manipulation Lawsuit

2016 is shaping up as the year when countless conspiracy theories will be confirmed to be non-conspiracy fact: from central bank rigging of capital markets, to political rigging of elections, to media rigging of public sentiment, and now, commercial bank rigging of silver.

In short, tinfoil hat-wearing nut jobs living in their parents basement have been right all along.

Two weeks ago we reported that “In A Major Victory For Gold And Silver Traders, Manipulation Lawsuit Against Gold-Fixing Banks Ordered To Proceed,” however one bank was exempt: Deutsche Bank. The reason why was known since April, when we first reported that Deutsche Bank had agreed to settle the class action lawsuit filed in July 2014 accusing a consortium of banks of plotting to manipulate gold and silver. Among the charges that Deutsche Bank effectively refused to contest were the following:

  • employment of a manipulative device claims
  • bid-rigging, and unjust enrichment.
  • price fixing and unlawful restraint
  • price manipulation claims
  • aiding and abetting and principal-agent claims.

Briganti’s affidavit provides some more information on the settlement process…

Wow!  $38 million…I’m underwhelmed.  It’s barely coffee money. This longish Zero Hedge piece showed up on their website at 9:18 p.m. EDT last night — and I thank Dr. Dave Janda for passing it around.  Another link to this story is here.

China gold demand to stay firm at 900-1,000 tonnes in 2017 – WGC

Demand for gold from top consumer China will remain strong at around 900-1,000 tonnes next year, near 2015 levels, although a weaker appetite for jewellery and slowing economy could curb purchases, an official of the World Gold Council said.

Continued firm demand from China should help underpin global benchmark gold prices that have come off two-year highs as expectations of a U.S. interest rate hike by year-end strengthened the dollar. But the precious metal remains up 18 percent for 2016, following a three-year decline.

We believe we may keep a certain level of about 900-1,000 tonnes of annual consumption (in 2017), but it may face some challenges especially on the jewellery side and also it depends on the price and China’s own economic situation,” Roland Wang, managing director for China at the World Gold Council, told Reuters on the fringes of an industry conference in Singapore.

He also expects demand in 2016 to be at around 900-1,000 tonnes. China’s gold demand reached 984.5 tonnes in 2015.

Wang said jewellery traders were seeing “more demand for gold bars since late September” with investors seeking alternate investment options amid China’s housing market curbs.

This Reuters article, filed from Singapore, put in an appearance on their Internet site at 1:37 p.m. IST on their Monday afternoon — and I found it on the Sharps Pixley website on Monday evening Denver time.  Another link to it is here.

The PHOTOS and the FUNNIES161018photo-2



Although it was a quiet trading day for gold and silver, with low volume in both, ‘da boyz’ were there if you knew where to look.  If you haven’t figured it out by now, they’re active in just about all markets that matter 24/7 — commodities or otherwise.

Gold closed below its 200-day moving average again yesterday — and for the fifth day in a row.  But strangely enough, silver has not been closed below its, at least not yet.

Here are the 6-month charts for all four precious metal — and in most respects it was just another day of watching grass grow or paint dry.161018-6-month-gold


And as I type this paragraph, the London open is less than ten minutes away — and I note that gold rallied four bucks or so in early Far East trading on their Tuesday morning — and after giving half of that back by 2 p.m. China Standard Time, it began to rally anew — and is up $6.80 currently.  It was mostly the same in silver, but it’s being aggressively capped at the $17.67 mark as I write this — and it’s up 20 cents the ounce at the moment.  It’s more or less the same price pattern in platinum and palladium, with the former up 10 dollars — and the latter by 6.

Net HFT gold volume is just under 28,000 contracts, but with a twenty minute reporting delay, it’s obviously much higher than that.  HFT volume in silver is just under 10,500 contracts — and it’s obvious from the price charts and the associated volumes, that JPMorgan et al are at battle stations as short buyers and long sellers of last resort to contain these rallies.

The U.S. dollar index headed lower right from the time that trading started at 6:00 p.m. EDT on Monday evening in New York.  It fell down to the 97.60 mark by 9 a.m. in Shanghai.  Then it rallied back about 15 basis points by 2 p.m. over there — and has been heading south at a goodly clip ever since — and as London opens, its down 21 basis points.

As I pointed out on Saturday — and at least one occasion last week — and now in today’s column, U.S. Mint sales are up by more than noticeable amounts compared to sales from the prior three months.  Ted had this to say in his weekly review on Saturday — and that was obviously before Monday’s big silver eagle sales from the mint — “It’s still too soon to determine if JPMorgan has returned as the big buyer of Silver Eagles after stepping back from that role several months ago, although I think the bank is buying Gold Eagles of late. With two weeks to go until month end, if Silver Eagle sales cross the 4 million (and preferably the 5 million) ounce mark, I’d conclude that the b**ch is back (with apologies to Elton John).

Add to that the two recent silver deposits into JPMorgan’s vault, plus the counterintuitive additions to both GLD and SLV recently — and the current environment has, as I also mentioned on Saturday, all the hallmarks of the strongest of hands — and the deepest of pockets, putting their markers down.

Whether or not we get sold lower from here is almost beside the point now.  I’m certainly expecting it, as is Ted.  But as he said on the phone yesterday, JPMorgan et al are 100 percent in control of the time-line — and they can do whatever they want.  However, if JPMorgan is back buying silver eagles and taking delivery in their own warehouse again, they wouldn’t be doing it if they weren’t expecting much higher prices — and soon.  If that’s the case, then maybe the bottom is in, at least on an interim basis.

We’ll see.

Today, at the close of COMEX trading, is the cut-off for this Friday’s Commitment of Traders Report — and I shall refrain from commenting on what it may or may not contain until my next column.

And as I post today’s column on the website at 4:05 a.m. EDT, I see that, as usual, ‘da boyz’ were busy capping the rallies in all four precious metals even before the London/Zurich opens.  As I type this, gold is only up $5.80 an ounce, silver is up 18 cent — and platinum and palladium are up only 7 and 3 dollars respectively.

Net HFT gold volume is up to just under 34,000 contracts — and that number in silver is just under 12,000 contracts.  It certainly hasn’t taken a lot of volume in the first hour of London/Zurich trading to cap and then turn lower, the prices of all four precious metals.  In the grand scheme of things, these weren’t notable rallies, except for the fact that they occurred in Far East trading once again — and the powers-that-be once again stepped in before the London open to do the dirty.

The dollar index stopped falling just minutes before the London/Zurich open — and has rallied a bit in the last hour — and I’m sure that was the usual “ramp the dollar index/smack the precious metals prices” move that we’ve seen countless times before.

After this price action, I haven’t a clue what will happen for the remainder of the Tuesday session.  But it will be another day where JPMorgan et al have the final word.  And, as always, all we can do is sit back and watch.

That’s all I have for today — and I’ll see you here tomorrow.


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